LONDON – In another blow to the Airbus A380 program, Emirates (EK) is seeking to cancel the final five of eight units yet to be delivered to the airline.
According to Bloomberg, the airline will take three more of the units all due by March next year, but do not want the final five.
Airbus is supposedly negotiating a deferral of deliveries or of payments in order to keep the production line for a while longer.
Emirates stated that it doesn’t discuss commercial negotiations but remains “in regular dialog with Airbus”.
Airbus also said the same, stating that such talks with customers are confidential and will not be released.
If Emirates walks away from this order, then it will have to pay around US$70m per plane for such cancellations. If it does not want the final five, then that means a price tag of US$350m as per the company’s annual financial report.
At the moment, three of the final eight A380 have been built, which will be the units due for delivery by the end of the fiscal year.
Wings and fuselage sections for the other five are at the final assembly plant in Toulouse, having been shipped earlier this year.
This news comes after EK was looking at cutting up to 30,000 jobs as well as reducing its Airbus A380 fleet.
Sir Tim Clark, the President of EK, declared that the “A380 is over” as well as stating in Gulf newspaper The National that the airline would be around 20-30% smaller after the Coronavirus pandemic has passed.
The airline is looking to shred around 30% of its workforce, whilst reducing the fleet number of the A380 to 69.
An Emirates spokeswoman was keen to add that no official announcement has been made yet but the airline is looking into it.
“Any such decision will be communicated in an appropriate fashion. Like any responsible business would do, our executive team has directed all departments to conduct a thorough review of costs and resourcing against business projections”.
Only Four More A380 Deliveries Left?
For Airbus, this means that if the cancelation goes through, those three units and the one remaining unit for All Nippon Airways (NH) will be the final A380 to come off the final assembly line and subsequently begin the closure of the program.
For EK, although the US$350m price tag for cancellation may seem a lot, the airline will make a saving of US$1.87m, according to the list prices from Airbus.
It will ultimately be money that the airline will need in order to calm the storm that is the COVID-19 pandemic.
Overall, this highlights what will be a very sad end to the A380 program, regardless of whether EK defers payments or deliveries.
Although we will still see the A380 flying around our skies until near the end of the decade, it marks an end of an era for Airbus with the super-jumbo, and the beginning of the era of aircraft such as the A320, A330, and A350s only.